Millions of college students are making a budget for school for the new year and taking charge of their finances for the first time. Managing money and homework can be stressful, especially with trying to make your money go further with recent inflation causing price hikes that may hit cash-strapped college students especially hard.
One of the best ways to get the most for your money is to make a plan from the very start. Here are some ways to make sure to stay on track financially this year:
Choose the best way to pay for things
When spending money, most people tend to think about how best to maximize their rewards. Rewards and cashback are great, but how you pay for things influences how much money you spend. That is especially true for college students who often manage their finances for the first time. Students can benefit from using a cash or debit card to get comfortable with spending, including keeping a budget and tracking expenditures, before moving on to a credit card.
This doesn’t mean giving up on earning rewards — many banks offer cashback for spending at certain retailers or offer rewards for using their products consistently. It’s critical to look at what each bank or debit card offers, as well as what types of fees they charge.
Make a budget and identify savings goals
Many people automatically assume budgeting means you cannot have any fun or enjoy things but having a budget can give you the freedom to enjoy things that matter as long as you keep the other things in check. One of the essential parts of an effective budget is figuring out what expenses to plan around. For college students, the most common expenses include:
• Apartment or dorm rent
• Utilities (such as phone, electricity, water, and internet bills)
• Car maintenance
• Greek life or other social organization dues
• Season athletic tickets
Every budget is unique to an individual, and so each person should make sure they are setting aside what they need for essentials but then prioritizing what is most important to them.
Outside of a core budget, the other essential to consider is savings goals. Having an emergency fund is vital for everyone, but in college, students need to plan for things like Spring Break or significant Greek life events or outings. Most people only have two buckets of money, their spending in their checking account and all the money set aside for various goals in their savings. But most need more than that to help save money for multiple purposes. For instance, SoFi Checking & Savings¹ offers Vaults, allowing students to set cash into specific goal-related funds within their savings account so they can easily monitor their savings toward each particular goal.
Use technology to help monitor spending and stay on track
Managing money can feel overwhelming, but college can be extra stressful with managing classes and navigating money management for the first time. But every college student has a phone in their hand more often than not, so it’s an excellent opportunity to deputize said phone to make monitoring spending and budgeting easier.
For instance, SoFi Relay², a financial insights tool, shows individual purchases made across bank accounts and credit cards linked to the platform, as well as spending trends throughout the month, categories people spend the most in, and how it compares to previous months and how someone is saving each month. This takes the burden of tracking spending and purchases manually off of students and makes it simple to keep an eye on spending habits and adjust budgets as needed.
Identifying the best financial partner
For students looking for a simple, all-in-one way to spend and budget, SoFi Checking & Savings provides students flexibility, low costs and access to financial education and resources. When you bank with SoFi, members pay zero account fees and receive automatic savings features, as well as vital resources on financial literacy and access to credentialed financial planners for bespoke advice on managing money.
Students can also earn up to 15% cash back at local establishments3 and access fee-free ATMs via the Allpoint network4, which offers over 55,000 ATMs across the country, allowing students to avoid fees, whether at home or on-campus. SoFi offers all these perks to both students and post-grads.
For more information, you can visit: www.sofi.com/banking/students.
1 SoFi Checking and Savings is offered through SoFi Bank, N.A.
2 SoFi’s Relay tool offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc’s service. The credit score provided to you is a VantageScore® based on TransUnion® (the “Processing Agent”) data.
3 Earn up to 15% cash back on local retailers. List of retailers may vary. See our terms and conditions.
4 We’ve partnered with Allpoint to provide you with ATM access at any of the 55,000+ ATMs within the Allpoint network. You will not be charged a fee when using an in-network ATM, however, third-party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.